Bank of Korea to assess inflation, growth for rate hikes, board member says

SEOUL, September 22 - A Bank of Korea board member disclosed on Tuesday that the central bank will decide the timing and intensity of upcoming interest rate hikes by meticulously analyzing inflation, economic growth, and financial stability, according to a statement accompanying the financial stability report. Chang Yong-sung, the board member, pointed out that elements such as mounting financial imbalances, sector-specific income gains, global market movements, and geopolitical uncertainties will significantly influence financial stability in the future.

To avoid these imbalances from worsening, Chang stressed the necessity of synchronizing monetary and macroprudential policies while collaborating with fiscal and financial authorities to address challenges faced by disadvantaged groups on a granular level. The Bank of Korea (BOK) had increased its benchmark interest rate by 0.25 percentage points to 3.00% on August 27, marking a second consecutive hike as inflation exceeded targets and financial stability concerns remained prevalent.